The Contagion on Business Failure by the Geographical Proximity: An Analysis with the Join-Count Tests in the Service Sector
DOI:
https://doi.org/10.46661/revmetodoscuanteconempresa.2687Keywords:
autocorrelación espacial, fracaso empresarial, tests join-count, spatial autocorrelation, business failure, join-count testAbstract
This paper aims to contrast the spillover effects in business failure derived from the geographic proximity among firms of the same sector. To get this purpose, we develop an empirical application based on the analysis of the join-count statistics on a sample of firms of service sector located in the municipality of Murcia (Spain). Our results show significant spatial autocorrelation pattern, therefore, the probability of failure in a firm not only depends on its internal characteristics, but also on the situation of failure of its vicinity peer companies. These results can be an interesting starting point in the development of papers which consider the interdependence effects among closer peer companies in business failure literature.
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